BASE Token Design Proposal: Adaptive Quote Currency Economics for L2 Value Capture Layer 2s are trapped in a paradox—low fees attract users but limit revenue. Here's how a BASE token by @base can break this cycle through quote currency mechanics + adaptive incentives, replacing current $180M in sequencer fees by instant $4B+ value creation combined with an even higher revenue projection. 🧵👇 With portfolio companies at Outlier Ventures @OVioHQ building on Base, we have a strong interest in this leading ecosystem's success. This proposal builds upon community discussions, outlining a token design that challenges traditional L2 models and suggests a sustainable alternative. Incentivize BASE-Quoted Pools @mosayeri explains: "Crypto bros have midcurved the value accrual narrative of L1 assets by arguing that the main driver is transaction fees." ETH and SOL derive value from being locked in AMM pools as quote currencies, not gas fees. BASE should do the same. Core mechanism: • Lock BASE → receive veBASE • Vote on liquidity incentives for BASE-quoted pools • Trigger Curve Wars-style competition • Sequencer revenue funds sustainable incentives Built on proven economic models from @virtuals_io + @AerodromeFi, but designed for L2 economics. Smart Emissions Additionally adaptive emissions respond to market conditions: Strong KPIs → more to Distribution bucket (Coinbase reserve, treasury, community) Weak KPIs → more to Growth bucket (ecosystem fund, validators, builders) No fixed vesting schedules and dynamic alignment across cycles. Coinbase <> Base Chain Alignment Strategic value for @coinbase: • 20% strategic reserve = $2B+ immediate value ($10B+ FDV) • Removes pressure to raise fees • Enables competitive POL revenue vs other L2s • Creates institutional custody revenue • Strengthens @base ecosystem bonding Distribution Strategy It should balance @coinbase users AND the Base ecosystem: As @Architect9000 noted, Coinbase One members for anti-Sybil but also active Base onchain users and especially verified @buildOnBase builders. Progressive Decentralization Roadmap Phase 1: Prove adaptive quote currency model Phase 2: Validator set + Futarchy governance Phase 3: Full decentralization + institutional credit markets As @SONAR observed, Stage 2 decentralization makes tokenization "strategically necessary." @jack_anorak nailed it: "BASE token is a product decision. Base wants token stimulus, and it must be neutral blockspace." The TradFi <> DeFi Bridge The opportunity, as @YTJiaFF put it: "With COIN backing it, BASE token would become a safe bridge connecting public companies with crypto assets." BASE would be the first token designed for enterprise credit markets with dual on/offchain collateral functionality. Conclusion This unique adaptive quote currency design creates >20x+ value vs the traditional fee extraction approach while expanding the leading L2 position of @base. This can become a significant win-win-win scenario for everyone @coinbase, @base, and the community. Full proposal 👇 What are your thoughts? @brian_armstrong @jessepollak Let's discuss 👇 Connect X: LinkedIn: Special thanks to @0xRak for the review.